House prices 'rising at record rates'
New figures released by property website Rightmove reveal sellers' asking prices rose by an average of 3.6 per cent in May - the highest such increase recorded for the time of year.With the price of a property coming onto the market now 8.9 per cent higher than it was one year ago, the market has reached its highest growth rate since October 2007, when the figure stood at 10.4 per cent.The average price of a house in the UK now stands at £272,003 - a record high. In addition, the average asking price of a property in London has risen by £80,000, or £4,500 per week, since the start of the year.There is a wide gulf between the capital and the rest of the country, however, with the national average excluding London registering an increase of £1,500 per week.Rightmove says a major supply boost is needed to prevent prices in the capital from rising excessively, with prices in ten out of 32 boroughs increasing by more than 20 per cent. The organisation claims the Mortgage Market Review, which introduced more stringent checks and affordability tests, could cool the rest of the market.Miles Shipside, Rightmove director and housing market analyst, said: "The capital now needs a programme of mammoth proportions to create a flood of housing supply. "More major transport initiatives, satellite new towns, and the release of building land for both the private and social sectors will help to relieve upwards price pressure and give better options for both its inhabitants and its economic success." While demand for properties remains strong, the supply of new properties coming onto the market is unable to keep pace. Rightmove says there was a one per cent fall in the number of properties coming to market when compared to April.Bank of England governor Mark Carney recently said the UK's booming housing market poses the biggest threat to the economic recovery, but added that the BoE is continuing to monitor the situation closely.
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